2.11: Sales Costs

Question 1

What are the retailers’ (retail and hospitality sector) main costs?

Answer 1

1. property coast
2. labour
3. equipment & materials
4. storage
5. delivery
6. margin at the point of sale

Question 2

What costs are associated with retail premises?

Answer 2

• location: prime location means pricier to buy or leaser
• decorating and furnishing
• maintenance
• security
• water
• energy
• insurance
• property taxes
• waste disposal

Question 3

At the very minimum, what equipment and materials will a specialist wine retailer need?

Answer 3

• till system
• fridge
• shelving
• display cabinets
• materials to enhance displays
• cleaning equipment
• wine fridges

Question 4

At the very minimum, what equipment and materials will a restaurant need?

Answer 4

• kitchen and bar equipment
• tableware
• glassware
• wine preservations systems
• wine fridges

Question 5

Define the margin at the point of sale. What is the typical range for retailers? For bars and restaurants?

Answer 5

• To be financially viable, retailers need to make a profit from selling the wine.
• retailers: 30-50%
• bars and restaurants: up to 66.6%